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Arvest Bank continued to be a top U.S. Small Business Administration (SBA) lender within its footprint in 2018, based on loan production.

That’s based on data for the SBA fiscal year ending Sept. 30. In Arkansas, for example, Arvest was the No. 1 SBA lender for the fifth consecutive year, based on its number of 7(a) loan approvals. Arvest made 64 such loans, totaling more than $27.2 million.

In Oklahoma, Arvest made 37 loans totaling more than $30.4 million. That ranks second in the state in terms of both number of loans and total loan volume.

Arvest also ranked among the top 10 in number of SBA loans made in eastern Kansas and western Missouri, according to the Kansas City District Office. Arvest’s 18 loans totaled more than $6.1 million.

“We are proud to continuously rank favorably when it comes to helping small businesses via SBA loans,” Arvest SBA loan manager said. “We are grateful that so many of our customers trust Arvest to help them with these transactions. Small businesses are the backbone of many of our communities, and we take pride in doing everything we can to help them.”

SBA 7(a) loans are its primary means for helping startup and existing small businesses deal with a variety of general business purposes, and Arvest remains an SBA-preferred lender, meaning the process is streamlined for applicants. Small business owners who need to explore financing options should talk to an SBA-approved lender who can offer them a complete range of available options.

Arvest Bank announced today its mortgage division has originated more than $1 billion in purchase-money mortgage loans in 2018, the third time it has done so in its history.

Arvest hit the $1 billion mark on Sept. 26, more than three months earlier than the previous two times it reached that milestone. Purchase-money loans are used to buy a home, as opposed to refinances and other types of loans.

“Home sales are driving the majority of our mortgage business this year, and reaching this $1 billion milestone has been even more remarkable given the rising interest rates and the housing inventory issues in some of our markets,” said Steven Plaisance, president and chief executive officer of Arvest’s mortgage division.

Arvest regularly originates more than $1 billion in mortgage loans – both purchase-money and refinances – having done so earlier in 2018 for the 16th consecutive year.

“Our team of mortgage professionals – from the start of your home loan process through servicing those loans long after you close it – are well-qualified to handle all the unique needs we see on a day-to-day basis,” Plaisance said. “Our mission statement of ‘People helping people find financial solutions for life’ is central to the mortgage services we offer and the team we build to execute those services.”

As of Sept. 26, Arvest had closed a total of 5,519 purchase-money loans with total loan value of $1,002,521,772. As of the same date in 2017, Arvest had closed 4,938 purchase-money loans with total loan value of $857,159,409. This year’s numbers represent an 11.7 percent increase in number of loans and a 16.9 percent increase in volume.

“We are privileged to work with so many Realtors®, brokers, builders and other housing professionals in all of our markets,” Plaisance said. “Being available to all of them and offering a variety of mortgage solutions for all of the communities we serve benefits everyone involved.”

Arvest is unique among most local lenders in that it services 99 percent of its mortgage loans, meaning that customers make their payments to Arvest and deal with Arvest for any needs after their loan closes.

It’s no secret a majority of prospective homebuyers use the internet to search for a home. What may surprise some, however, is how many mortgage customers now submit their application digitally.According to a 2017 J.D. Power study, both purchase and refinance customers cite online/website as the most frequent method of submitting a mortgage application. The 43 percent who did so in 2017 represented a jump from just 28 percent in 2016.

Those numbers – representing consumer preferences for how they want to do business – are part of the reason community banks have begun empowering their customers with online and mobile mortgage application tools. These tools allow consumers to have more control of how, when and where they apply for a mortgage.

At Arvest Bank, for example, a recently updated online mortgage platform and a newly launched mobile app give mortgage customers the ability to act quickly in a real estate market marked by low inventory and heightened competition among buyers.

“Today’s consumer prefers a streamlined process, so we’re delivering those efficiencies in the area of mortgage loan applications,” said Steven Plaisance, president and CEO of Arvest’s mortgage division. “Through the Arvest Home4Me mobile app, loan applicants can submit the necessary documents for prequalification in the first few screens of the app. The app populates the data into the system for a loan officer to review, then we contact the applicant and complete the request.”

Similarly, Arvest utilizes an online mortgage platform developed by Ellie Mae that allows borrowers to research rates and types of loans, and to submit an application electronically.

“Leveraging technology is no longer an option for local banks,” Plaisance said. “It’s a must.”

Despite the mortgage customers’ increased preference for a digital experience, though, community banks still offer the kind of personalized service customers crave. That sentiment is reflected in the J.D. Power study, as it indicated satisfaction among customers applying online/via website declined by 18 points year-over-year.

“It’s important that these self-serve conveniences are available for those who want that option,” Plaisance said. “At the same time, though, some customers may still want to tap into the expertise our local mortgage experts can offer. What we’ve really tried to do is create a hybrid approach that allows the consumer to choose what works best for their unique situation.”

Arvest Bank has released Skyline Reports on residential and multifamily real estate in Northwest Arkansas for the first half of 2018.

During the first half of this year, the average price for homes sold continued to rise and reached record highs in both Benton and Washington counties. The increase in Washington County from the first half of 2017 to 2018 was especially significant at 12.3 percent, moving from $209,899 to $235,618. In Benton County the increase was 4.9 percent, moving from $227,036 to $238,098.

Looking at five-year trends, the average price of homes sold in Washington County has increased from $173,979 in the first half of 2013 to $235,618 in the first half of this year – an increase of 35.4 percent, which is an average annual increase of 7.08 percent. In Benton County the average price of homes sold in the first half of 2013 was $185,500 compared to $238,098 this year – an increase of 28.4 percent, or 5.68 percent annually.

Homebuying activity remained strong in the first half of 2018 with 4,438 homes being sold in the period, up 1.2 percent from the first half of 2017 when 4,385 homes were sold, and up 45.5 percent from the first half of 2013 when 3,051 were sold.

Mervin Jebaraj, director of the Center for Business and Economic Research (CBER) at the Sam M. Walton College of Business at the University of Arkansas, said there are several factors contributing to the rising prices, including labor and material costs and the shrinking supply of available lots on which to build new homes. The supply of remaining lots in active subdivisions, based upon the previous 12-month absorption rate, was 29.6 months in the first half of 2018, up slightly from 28.9 months in the first half of 2017 and down significantly from 94.3 months in the first half of 2013.

“Affordability is becoming an issue in the residential real estate market in Northwest Arkansas as the increase in home prices significantly outpaces both wage growth and inflation,” Jebaraj said. “With our population expected to continue to grow at a rapid pace, we need to continue building new homes to meet demand, but there are far fewer lots on which to build new homes. This is especially true within the larger cities in the region where many people desire to live.

“What we are seeing in the data is that more and more people are choosing to lease apartments instead of buying homes, because the apartments tend to be closer to the amenities they desire and are considered to be more affordable. This, in turn, is fueling the insatiable growth in the multifamily market, which continues to add new multifamily properties at a rapid pace without any sustained increase in the vacancy rate of those properties.”

The multifamily real estate market in Northwest Arkansas has grown, in terms of total square feet, by 22.8 percent during the past five years – from 19,292,047 total square feet in the first half of 2013 to 23,682,495 in the first half of this year – but the vacancy rate has remained very healthy, falling slightly from 4 percent in the first half of 2013 to 3.9 percent in the same period of 2018. The average lease price for apartments has increased 20.7 percent since the first half of 2013, from $538.34 to $660.80.

The Arvest Skyline Report is a biannual analysis of the latest commercial, single-family residential and multifamily residential property markets in Benton and Washington counties. The report is sponsored by Arvest Bank and conducted by CBER.

In 2004, Arvest Bank contracted with CBER to collect information about the local real estate markets. CBER researchers aggregated and analyzed data from local governments, property managers, visual inspections and the business media to provide a complete picture of the status of property markets in the two counties.

CBER provides excellence in applied economic and business research to federal, state and local government, as well as to businesses currently operating or those that desire to operate in the state of Arkansas. The center further works to improve the economic opportunities of all Arkansans by conducting policy research in the public interest.

Investment products and services are provided by Arvest Investments, Inc., doing business as Arvest Asset Management, member FINRA/SIPC, an SEC registered investment adviser and a subsidiary of Arvest Bank. Trust services are provided by Arvest Bank. Insurance products are made available through Arvest Insurance, Inc., which is registered as an insurance agency. Insurance products are marketed through Arvest Insurance, Inc., but are underwritten by insurance companies.
Securities and Insurance Products: Not Insured by FDIC or any Federal Government Agency, May Lose Value, Not a Deposit of or Guaranteed by a Bank or any Bank Affiliate.